7 Reasons Why Insurance Companies Should Leverage Conversational Apps

conversational apps in insurance

Insurance companies are at a crossroads. With 82% of consumers expecting immediate responses to routine inquiries, the traditional interaction methods just don't cut it anymore. As customer expectations lean increasingly towards on-demand responses, conversational apps stand out as the natural path forward in the insurance sector. 

Integrating conversational apps with existing communications strategies enables companies to meet the urgent demands of today's consumers and make communication simpler and more intuitive.

What are conversational apps?

Conversational apps are not chatbots. Rather, they are sophisticated communications solutions that integrate and typically operate on top of popular messaging platforms like WhatsApp, Facebook Messenger, and Telegram.

These solutions allow for a broad range of interactions from browsing insurance products to processing claims—all in a conversational format that feels natural and familiar to the user. They combine text, rich media, and interactive elements to deliver a seamless customer experience, far surpassing the capabilities of traditional chatbots.

claims with conversational ai

Beyond text-only chatbots

Moving beyond the limitations of simple, text-only chatbots, conversational apps bring sophisticated capabilities into everyday customer interactions. With features that include natural language processing (NLP), graphical user interfaces, and personalized responses, these platforms offer a depth of engagement that greatly contributes to customer satisfaction and operational efficiency.

Here are 7 compelling reasons why insurance companies should adopt conversational apps to stay ahead in a competitive market

1. Meeting customers where they are

Conversational apps tap into the messaging platforms that billions of users access daily—WhatsApp alone has over 2.7 billion users. Unlike native apps, which may sit unused and with notifications turned off, these platforms ensure that your messages are seen and engaged with. This is especially crucial in the insurance sector where timely communications can dramatically improve customer service experiences.

2. No app fatigue

There is a growing reluctance among consumers to download additional apps due to space and usage limitations on their devices. In 2021, Forbes reported that 91% of consumers hate being forced to install apps to do business.

push notification fatigue

In a perfect world, customers will not need to use an insurance company’s app frequently. Conversational apps leverage existing platforms that users are already familiar with and use daily, eliminating the barrier of app fatigue. This ensures that insurers can maintain consistent communication without adding to the clutter on customers' devices.

3. Improved speed and quality of customer service

Conversational apps enable insurers to respond to customer queries faster and more efficiently. This not only improves the customer experience by providing instant support but also aligns with consumer expectations for speed and accuracy—essential factors in increasing customer satisfaction and loyalty.

InsureTechs like Lemonade Inc. are redefining customer service by using AI to allow policy purchases in 90 seconds and claims payments in 3 minutes, offering more control and transparency. This innovation is reflected in their exceptional NPS score of 70, significantly higher than the industry average of 17.

4. Cost-effective customer interactions

By integrating conversational apps, insurance companies can significantly reduce call centre volumes and operational costs. These platforms allow for the automation of common queries and the efficient management of customer interactions, which translates to reduced overheads and a better allocation of resources.

IVR deflection with conversational apps

Conversational apps streamline insurance processes, reducing the average cost per claim by up to 80% and increasing customer satisfaction, as evidenced by faster claim resolutions that are 5x quicker than traditional methods. This efficiency addresses customer confusion and significantly reduces resolution times, thereby improving the overall experience.

5. Improved engagement and completion rates

Conversational apps significantly boost engagement and streamline the insurance process. They do so by simplifying complex insurance procedures by reducing the steps needed for customers to understand and manage their policies, which leads to higher completion rates. For example, rather than wading through dense policy information, customers can receive guided, automated responses that help them quickly identify the right coverage options.

increased completion rate with conversational apps

This not only helps with information clarity but also significantly increases communication completion rates from under 10% to over 80%. Such improvements cater to the needs of over 75% of insurance customers who report difficulties understanding their policies. Integrating these conversational apps into familiar digital routines greatly impacts customer satisfaction.

6. Personalized customer experiences

These apps integrate seamlessly with existing CRM systems, allowing for personalized communications based on previous interactions and customer data. This capability enables insurers to offer tailored advice, recommend specific products, and proactively address potential issues, enhancing the overall customer journey and strengthening customer relationships.

Conversational apps blend automation with human touch, allowing insurers to provide personalized support and free up agents when absolutely necessary. By automating routine questions—up to 98% in some cases—these apps ensure quick responses, improving customer satisfaction and enabling businesses to scale efficiently.

7. Ensured Security and Compliance

Prioritizing thorough security measures and GDPR compliance is crucial when adopting new communication channels. Advanced conversational apps with robust enterprise-grade tech that integrate with messaging apps like WhatsApp, such as Hubtype, ensure end-to-end encryption and highly secure exchange of sensitive data so only the sender and recipient can view messages.

This critical feature mitigates the risk of data breaches, aligning with strict privacy standards.

Multiasistencia needed a solution with the ability to meet GDPR requirements while leveraging WhatsApp, a platform widely used in their target markets. Hubtype was able to offer them robust data protection features, which include streamlined processes for obtaining and managing user consent and secure handling of customer data requests.

“These initiatives enormously increase the value we provide to the customer and enable us to track our operations better,” explains Jorge Fernández González of Multiasistencia while discussing the company’s partnership with Hubtype. “Using traditional channels, this is simply not possible. We see it as a relationship evolution with our customers.”

Insurance made easy

For insurance companies, the shift to conversational apps isn’t just about keeping up with technology trends—it’s about fundamentally improving the way they interact with customers. Conversational apps offer a unique combination of accessibility, cost efficiency, and superior communication capabilities, making them an indispensable future-proof tool. As consumer behaviour continues to evolve, insurers that adopt conversational apps will be better positioned to meet their customers' needs effectively and efficiently.

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